Many couples that have chosen to pursue divorce expect a simple process that won’t take much time. Unfortunately, when it comes to the division of marital estates, a divorce can quickly turn into a messy situation. Couples are encouraged to become familiar with the different types of marital property and how property is divided from state to state. Identifying whether your divorce will be considered a high asset case is also beneficial, so you’re prepared for whatever situation comes your way. Additionally, the assigned judge will also determine whether spousal maintenance is necessary. Divorce can be tricky and time-consuming, but hiring an experienced family law attorney will prepare you for success.
The Difference Between Marital and Non-Marital Property Division
Divorce is already stressful and emotional for both spouses, and property division can make it much more difficult. Whether the divorce is mutual or is one spouse’s choice, it’s incredibly important for each party to familiarize themselves with the different property division types and residing state guidelines.
When a married couple decides to divorce, any property, debts, and assets are categorized as marital property unless determined otherwise. The state of Minnesota follows equitable distribution, which is the fair distribution of all marital property that best benefits each spouse. These guidelines don’t always mean each spouse will receive the same amount of property, however. In some instances, one spouse may receive monetary contributions equal to the other spouse’s acquired property. The court system reviews several factors to determine how marital property will be divided from the length of marriage and occupations to estate information and spousal contributions as a homemaker. There are many more factors a judge will review as well, meaning it’s imperative to become familiar with all aspects so you can adequately prepare for court.
In Minnesota, non-marital property is not eligible for equitable distribution. All property acquired by each spouse before, during, or after the marriage is categorized as non-marital property. If a spouse wishes to dispute specific marital properties that should be considered non-marital property, the individual must prove that the designated property is non-marital. The evidence can consist of bank transactions, receipts, and more. Below are a few examples of non-marital property:
- Property owned before marriage
- Property excluded by a valid prenuptial agreement
- Property acquired through exchange of other non-marital property
Breaking Down Spousal Maintenance in Minnesota
Every state differs in how spousal maintenance is determined, and in Minnesota, many factors are reviewed to establish equitable distribution. Spousal maintenance is granted to a spouse to preserve their quality of life and give them time to individually establish themselves after a divorce. Each spouse must become familiar with the factors the court considers when granting spousal maintenance as the decision is ultimately out of your control.
What Kind of Spousal Maintenance Have You Been Awarded?
Upon reviewing various factors covered below, the judge will determine whether spousal maintenance should be awarded. There are two types of spousal maintenance available for divorcing couples, temporary and permanent. Temporary spousal maintenance is often granted for shorter marriages and is a limited-time award. This type of spousal maintenance is usually awarded as a rehabilitation opportunity for one spouse to finesse their skills and establish income for the new way of life. Permanent spousal maintenance is not as standard and is usually granted for longer marriages. This type of spousal maintenance is not permanent but will occur until a spouse dies, remarries, or the court orders otherwise.
Factors Under Consideration
Many factors within a marriage directly affect the type of spousal maintenance a judge awards, if any. Keep in mind; every divorce case is unique, meaning it’s difficult to determine how your case will turn out compared to others. The state of Minnesota strives to reach a decision based on each party’s fairness and doesn’t consider marital misconduct. Below are a few examples of what a judge assigned to your case will take under consideration:
- Length of marriage
- Financial resources
- Standard of living
- Loss of earnings
- Retirement benefits
- Physical and emotional health
Individual factors and events can cause spousal maintenance awards to change, from clerical errors in payments and fraud to falsified information and hidden assets. Along with these, if one spouse loses a job or has changes in health, the judge will also review these circumstances and possibly make the decision to reform a spousal maintenance order.
Essential Details of Property Division
Locations throughout the United States follow different property division guidelines, meaning it’s vital for you to become familiar with community property and equitable distribution. There are many kinds of divorce both your attorney and the court system may determine as best for your unique situation. If your divorce is civil, there is an opportunity to navigate property division outside of court. Regardless, these are three crucial property division details to consider when first initiating your divorce.
Navigating Divorce Types
Divorce comes in many forms, and becoming familiar with each type will help both you and your spouse navigate family law should you decide to pursue a divorce. Each divorce case differs, making it extremely important for each party to have guidance from an experienced family law attorney. Below are the different types of divorce that are pursued by the court system today:
- Fault and no-fault
Location of Residence
The state in which both parties reside affects the type of property division. Locations throughout the United States follow different guidelines on how the court system determines property division in a divorce. These guidelines consist of community property and equitable distribution. Community property is divided between spouses, while each spouse has the opportunity to keep their separate property. Equitable distribution occurs when a court system requires all assets and earnings acquired during a divorce as marital property, meaning all items must be divided equitably. Keep in mind; this doesn’t mean the division will be equal, but fair in the sense that each spouse receives equal monetary and physical property contributions.
Solo Property Division With Your Spouse
If your divorce is a mutual decision and both spouses can remain civil, dividing property on your own is possible. Handling divorce and property division outside of court can be extremely cost-effective and is relatively simple to navigate. To get started on solo property division without court guidance, follow these simple steps:
- Create a list of property
- Establish value for each item
- Select an owner
- Have a judge grant approval
What About a High Asset Divorce?
Couples with a massive estate will pursue a high asset divorce, which can be extraordinarily complex and often emotionally taxing and stressful. Regardless of your situation, a dedicated family law attorney experienced in high asset divorces will adequately represent you with your best interest in mind.
What to Expect
During a high asset divorce, many factors are determined that can be life changing. Credible information is one of the best tools each spouse can utilize and benefit from. Regardless of the underlying factors that caused the divorce, becoming familiar with expectations and elements reviewed is highly recommended. A judge that is reviewing a high asset divorce case will likely determine the following:
- Marital property division
- Spousal maintenance
- Child custody
- Child support
High asset divorces require extreme review and guidance in the financial sector as there is commonly an abundance of earnings and items of high monetary value. It’s encouraged for each spouse to compile essential financial documents early on, so documentation isn’t misplaced during the divorce process. Placing all of your finances and financial documentation in one secure location will not only give you an idea of what type of financial situation you could be dealing with but will also adequately prepare you for the upcoming work with your attorney.
Within a high asset divorce, here are both marital and non-marital assets. Many couples involved in a high asset marriage create a prenuptial agreement early on to establish what assets go to which individual. Your family law attorney will be prepared to navigate the relationship and divide property under equitable distribution guidelines. Out of state or international assets are also common during a high asset divorce, but experts are commonly brought in to sort out these matters.
A married couple who chooses to pursue a divorce may not always agree on several factors from getting divorced in general to the terms of the divorce. A contested divorce or one where the parties cannot agree commonly occurs in a high asset divorce. The state of marriage, relationship between two individuals, and cause of divorce each play into whether a divorce is contested or uncontested. A high asset divorce that is contested can be extremely time consuming and will likely result in a valuation appraiser reviewing each asset’s worth and identifying any assets that may have been brushed aside.
Contact an Experienced Family Law Attorney Today
From familiarizing yourself with the various types of marital property and property division to determining the needs for a high asset divorce and spousal maintenance, there are many steps couples going through a divorce can take to prepare. Each divorce differs in the amount of time spent, and each spouse’s individual needs, meaning no divorce is the same. Hiring an experienced family law attorney can set you up for success as they will provide outstanding guidance and support for the duration of your divorce case.Read More
You’ve probably heard of spousal maintenance before, and if not, you’ve certainly heard of alimony. Well, they’re one and the same, but here in Minnesota — there are some slight differences in how spousal maintenance is handled and awarded following a divorce.
Spousal maintenance exists to preserve the lower-earning spouse’s standard of living, and you’ll typically hear about these awards following high profile divorce cases. However, spousal maintenance isn’t just for the rich and famous — as many divorcing couples may find themselves in conflict about whether or not these awards should be given or received.
In a perfect world, divorcing couples would sit down and discuss what is fair regarding spousal maintenance. They would come to an agreement regarding the amount and the length of these awards instead of taking it to court. Unfortunately, that’s not how it typically goes. Divorcing couples that cannot amicably agree to spousal maintenance time frames and amounts — end up in court. Here, it becomes both expensive and uncertain, as it’s left in a judge’s hands.
Compared to other legal struggles involved in a divorce, such as child support settlements, where there’s a clear cut formula — spousal maintenance is up to the court. While there’s no formula, there are factors surrounding a couple that illustrates trends in how the courts will award spousal maintenance.
What Factors Affect a Judge’s Decision?
The judicial discretion that surrounds spousal maintenance means that there are certain factors that have a significant impact on the success or failure of a request.
These awards can be either temporary or permanent.
Now, before diving into the various differences between a temporary and permanent spousal maintenance reward, let’s explore the factors that can affect a judge’s decision.
Every case is unique, and as we mentioned, there is no one size fits all equation or solution that determiners spousal maintenance. In Minnesota, the courts attempt to make a decision based on fairness for both parties involved and do not take marital misconduct into consideration.
Well, at the top of the list of factors is the length of the marriage and the income of each party. However, these aren’t the only stipulations that play a role. Here are some of the most influential factors that will determine whether or not spousal maintenance is rewarded — along with its temporary or permanent status.
Obviously, income disparity between spouses can drastically affect whether or not spousal maintenance is rewarded. Spousal dynamics are in play here, as one partner may work while the other takes care of the home. Therefore, income may be fruitful for one, but only possible due to the sacrifices made by the other.
Assets and marital property can have a significant impact on the type of spousal maintenance and the amount rewarded. So, it’s important to know the size of varying marital estates and how whether or not it’s marital or non-marital property. The status of the assets is crucial and can play a big role when it comes to how the court decides spousal maintenance.
It may come as a surprise, but the age of each spouse can also affect a judge’s decision. The ability to work or acquire the job skills necessary for obtaining income is important.
Standard of Living
While the standard of living may play a bigger role in massive estate divorce cases, it’s still possible that the average spousal maintenance case may be affected by this factor.
Job history, work experience, and education all contribute to skills that make career opportunities and income possible. So, it’s not difficult to see why these factors play their part in how the courts determine spousal maintenance. If one spouse sacrificed schooling to raise children, this might be grounds for spousal maintenance awards. Financial stability arises from a foundation, and a judge will take this into consideration when considering awards.
In addition to what we’ve already covered, loss of earnings, retirement benefits, and other financial opportunities that one spouse may have declined or put on hold can also affect spousal maintenance awards.
All of these factors play a role, and while they’re not the entirety of the decision-making process — they do have a significant impact on the spousal maintenance decision. Even physical and emotional health may be looked into as well.
While it would be a lot cheaper and more efficient for spouses to come to a shared conclusion — these cases are typically highly contested. It’s for this very reason that having an experienced family law professional by your side is so important during this process.
Temporary Vs. Permanent Spousal Maintenance
When a judge examines all of the factors we mentioned above, the decision to award spousal maintenance isn’t the only determination. There’s also the type of spousal maintenance too. In Minnesota, a judge will decide whether or not a temporary or permanent model of spousal maintenance suits a particular divorcing couple.
Temporary Spousal Maintenance
Depending on a wide range of circumstances, a temporary spousal maintenance order may be the right fit. Shorter marriages may be grounds for a temporary spousal maintenance decision. Moreover, if one spouse is on their way to obtaining certain job skills, in school, or attempting to gain employment, temporary spousal maintenance may be given. The limited-time award serves as a sort of rehabilitative period where one spouse can get back on their feet and establish liveable income.
Permanent Spousal Maintenance
A judge may decide that permanent spousal maintenance is appropriate. However, it’s not a very common result. Longer marriages (20 years or more) with a very large gap between incomes are typically a candidate.
It should be noted that permanent spousal maintenance is difficult to obtain — but not impossible with the right legal counsel. Permanent does not mean forever, as the order will end once a spouse dies, remarries, or a court order in the future says otherwise.
Can Spousal Maintenance Orders Change?
Yes, there are several stipulations that may cause spousal maintenance rewards to change. Whether it’s clerical errors in payments, fraud, falsified information, hidden assets, or an over-turned order — spousal maintenance can be affected by certain conditions.
New evidence that affects a case or emerging financial situations such as job loss could also play a role. Health changes or even remarriages could also affect spousal maintenance orders.
Here in Minnesota, spousal maintenance cannot be affected by who is at fault when it comes to divorce, even with adultery. We’re what is commonly known as a “no-fault state.” So, a spouse cannot attempt to seek rewards based on the cause of the divorce.
Whether you’re attempting to obtain spousal maintenance or you’re trying to contest it, you’ll need an experienced family law attorney by your side. It can be an extremely stressful and time-consuming endeavor, but the right advocate and legal counsel can make a real impact.Read More
Divorce is an emotionally charged and difficult process, and it only becomes more complex when property division is added into the equation. One of the best ways for individuals to protect their rights is to become knowledgable and well-informed regarding their responsibilities — along with what they are entitled to during property division.
It’s not uncommon for divorce proceedings to be lengthy and stressful endeavors. It’s during these troubling times that many spouses find themselves missing crucial pieces of information about the nuances of property division, and how they can ensure that their rights are being taken care of.
How Minnesota Handles Property Division
One of the more misunderstood aspects of property division is how different states actually have varying ways in which they manage the process.
Minnesota is considered an equitable distribution state. A judge will consider a wide variety of factors that may impact how to distribute property amongst the parties equally. Some of these factors include (but are not limited to):
- The length of the marriage
- Prior marriages
- Personal & financial circumstances of each spouse
- Earning capacity
- Both spouses age
- Contributions to marital property
Essentially, all property that is acquired during a marriage is considered marital property and, therefore, can be equally divided between both parties. However, non-marital property can still be owned by an individual even if it’s acquired while the marriage is still intact. Non-marital property is not a part of the property division equation.
Minnesota does not offer both parties an automatic split down the middle route, where marital assets are divided 50/50 between spouses. Instead, the court will use the factors mentioned above, such as the length of the marriage, earning capacity, etc. to determine what is an equitable division of property.
While Minnesota and other states adopted the equitable distribution as their property division methodology, some states utilize community property laws to regulate property division.
Currently, there are nine states in the U.S. that are considered community property states.
- New Mexico
In these states, all property that is acquired during a marriage is considered marital property, which means that it can be divided between spouses during a divorce. Because both individuals are considered one singular economic unit, each spouse is entitled to exactly half of the marital assets during a dissolution.
The Ins and Outs of Marital Property
Marital property can seem like a complicated situation on the surface, but once an individual understands the bottom line that separates marital and non-marital property, they are able to make much more informed decisions during a divorce.
For couples in Minnesota who are going through the difficult process of a marriage dissolution — marital property is of the utmost concern. However, there may be some grey area surrounding what is marital property and what is non-marital property. We’re here to provide some much-needed clarity regarding their differences.
What is Marital Property?
Before the valuation stage of a divorce, any property, debts, or assets that were obtained during the marriage are considered marital property. The valuation stage usually takes place during the “Initial Case Management Conference” and is put in place to mark the separation of marital property.
Any property, assets, or debts are then considered eligible for property division here in Minnesota. There are certainly some areas that may need further discussion, such as an inheritance, but that is typically taken care of during the designated valuation stage. An experienced family law and divorce attorney will help create some transparency and equitable division.
If a spouse wants to dispute certain properties that were acquired during the marriage and claim them as non-marital, they may do so. However, it’s up to whichever spouse is making these claims to provide proof that the designated property is, in fact, non-marital.
Because Minnesota only divides marital assets, we often get questions about how the courts make their decision. There are a lot of factors that can affect marital property division, including:
- Marriage length
- Any prior marriages
- Sources and amount of income
- Health conditions
- Estate information
- Liabilities of each spouse
- Futura capital asset opportunities
- Spouse contributions as a homemaker
- Value contributions of each spouse (acquisition, appreciation, depreciation, and preservation of marital property value)
Each one of these areas can affect the division of marital property, and it’s important for spouses to be aware of how these factors can impact the outcome of a divorce.
What is Non-Marital Property?
Non-marital property is not eligible for division in the state of Minnesota. But, what is non-marital property?
Any and all property that was acquired either before, during, or after the marriage is considered non-marital property. However, these are not the only stipulations that designate property as non-marital.
Gifts, bequests, or inheritances received from a third party to only one spouse is non-marital property. Also, property, assets, or debts that were acquired after the valuation date are non-marital by nature and are not subject to division. The same can be said for property, assets, or debts that are designated as a part of a valid antenuptial agreement as non-marital.
The Home and its Complications
Some property can be a little complicated, especially the home. There are certain issues that can arise when dealing with the homestead in that it is not uncommon for one spouse to have owned the property prior to getting married.
The waters can become muddy because, after the marriage, both spouses live in that home and create marital value within the same location and property. So, when a marriage dissolution occurs, the home can become both marital and non-marital and requires specialized consideration during the property division stage.
This is where the Schmitz Formula comes into play, and it’s a technical way in which the courts manage certain complications regarding the homestead and property division.
How Cline Jensen, PLLC. Can Help
Finding experienced legal counsel during a divorce can make a world of difference in protecting a spouse’s rights and ensuring fair and equitable property division. Understanding the differences between non-marital and marital property is an important step for couples in Minnesota, where equitable distribution determines their future.
Here at Cline Jensen, PLLC., we’ve guided numerous spouses through the difficult property division process, and we have satisfied testimonials to back it up.
A divorce is an emotionally taxing experience, regardless of the size of the estate. However, high asset divorce settlements can be an especially complex process, involving more financial assets and complications that require experienced legal support.
With a massive estate, there is so much more at stake. It’s not uncommon for these more significant estate divorce settlements to be a messy affair. However, it doesn’t always have to be this way. A dedicated family law attorney with experience in high asset divorce settlements can help mitigate issues and alleviate some stress. A trusted attorney can protect your interests and secure your future, keeping your informed about your rights and advocating for you every step of the way.
Get Your Finances in Order
One of the most complex areas of a high asset divorce is the financial web that needs to be sorted out. Locating all of the essential financial documents before the divorce begins can give you a head start. These documents need to be protected because they can provide substantial proof of what is considered marital vs. non-marital property.
Once a divorce is underway, the emotional toll can be difficult to navigate. Also, belongings get shifted around, and documents may be accidentally (or in some cases, purposely) divided, which means crucial financial documents may be hard to find. Getting your finances in order before the divorce process begins can be a huge lifesaver.
Also, having all of your finances and financial documentation in one secure location can paint a picture of what type of financial situation you may be dealing with. High asset divorce settlements deal with a lot of assets, and some may be forgotten until it’s too late. If you don’t want any surprises popping up during the property division stages, it’s smart to locate and secure these financial documents early.
What to Expect During a High Asset Divorce
One of the best tools at a spouse’s disposal during a high asset divorce is information. Knowledge about what to expect and which factors may affect one’s future is essential in any divorce but is especially important during a high asset divorce with a large estate.
Some key elements of a high asset divorce include division of marital property and spousal maintenance (also known as alimony). If there are children involved, there will certainly be child custody, visitation, and child support considerations that will need to be managed with care and attention.
A Deeper Look at Finances
Assets have various statuses during a divorce, and understanding which falls under a specific category is important when handling a high asset divorce. Marital assets (also known as community assets) are those that have been earned, acquired, or obtained during the marriage and are subject to division. Prenuptial agreements may change these stipulations up slightly, but typically, these marital assets are divided according to equitable distribution.
Equitable distribution means that the courts look at a wide variety of factors that contribute to the state of the marriage and then divide marital property equally between the spouses.
Separate assets, or those that are considered non-marital, will not be split between the spouses upon a divorce. These assets can include:
- Property owned before the marriage
- Property that has been purchased under a single spouse’s name, purchased to keep separate, or separated in writing
There are are a lot of assets that fall into a grey area, especially in massive estate situations. Non-marital assets end up combined with marital ones, and the complexities only seem to get larger and larger. An experienced divorce attorney can help trace non-marital assets that may have been commingled marital assets, which is another reason why locating documentation early on is so important.
Out of state or international assets are also fairly common during high asset divorce. Foreign assets or those that are located out-of-state will need experts brought in to deal with. Sound legal counsel and early intervention with these assets are crucial.
Likelihood of a Contested Divorce
Depending on the state of the marriage, cause of the eventual divorce, and the relationship between the two spouses — the probability of a contested divorce is much higher with larger estates.
This is primarily because spouses are in a much better financial position to spend the money to contest. Also, the money spent contesting certain assets may pale in comparison to the reward of winning a certain set of assets. So, if the asset rewards are higher than the price of the divorce, you can expect to see a contested divorce.
Valuation appraisers will likely be brought in to determine the value of the assets being split up, especially in larger estates where expensive assets are everywhere. Each spouse will have their own independent valuation expert that will determine an asset’s worth, along with helping identify assets that may be overlooked or forgotten.
During a contested divorce, the most costly asset is time. These proceedings can be drawn out for an unnecessary length of time, especially when financial paperwork isn’t located early on — or is hidden from the other spouse. Not only does this cost both parties more than they need to spend during the divorce, but it can also have consequences in court.
It’s not unlikely that spousal maintenance may be part of the equation during a high asset divorce. However, it can be far more complicated than a smaller estate. Uncovering the financial complexities of a massive estate can breed contention amongst the parties and also be difficult to do.
As we mentioned, parties may hide financial documentation from their spouses before or during a divorce. They may also hide bank accounts, assets, or even property from their significant other. During a divorce, these assets may be uncovered and may drastically impact spousal maintenance proceedings.
Find an Attorney You Can Trust
High asset divorces are a difficult endeavor and require veteran divorce attorneys that can advocate for and support your interests. The messy nature of high asset divorce cases means that you need an attorney that you can trust and who understands the financial complexities of a massive estate divorce.
Do your research and make sure that your attorney has a longstanding history of success in family law cases, especially with complicated estate divorce settlements.Read More